Given the rising demand for more environmental protections and resource
conservation by the general population, many companies also are putting
together strategies on how best to base the improvement and manufacture of
their products upon the concept of greater sustainability. Above all, ever-rising
crude oil prices have led the general plastic industry to invest substantially more
in the research and development of bioplastics. Indeed, increased demand for
bioplastics provides, in turn, for an expansion of production capacities.
Bioplastics are a new generation of biodegradable plastics, made entirely or
almost entirely from renewable raw materials. Recent advances in research and
technology have shown that these plastics can be made from abundant
agricultural resources. They preserve nonrenewable resources - petroleum,
natural gas, and coal - and contribute little to the already burdensome problems
of waste management.
Derived from renewable biomass sources such as plant starches and vegetable
fats, bioplastics are a cutting-edge biodegradable technology seen by many as a
sustainable alternative to chemically produced plastics. The most widely known
types of commercial bio-plastics include polylactic acid (PLA), polybutylene
succinate adipate (PBSA), polybutylene adipate terephthalate (PBAT), and
polyhydroxyalkanoates (PHAs). There is mounting demand for these
biodegradable, environmentally friendly products as the populations of many
countries have become increasingly environmentally conscious.
It must be mentioned that the global demand for bio-plastics is expected to more
than triple to an approximate worth of US$2.9 billion by the year 2015. Starch

based resins and PLA are expected to more than double in demand by 2015,
while PHA resins are expected to show the greatest increase in demand.
Thailand, a country that is home to a strong, thriving agricultural base and
advanced technologies as well as research-driven resources, provides a
competitive advantage to the bioplastics industry. The combination of copious
and affordable raw materials and modern manufacturing facilities places
Thailand in a strategic position as a nation readying itself to become one of the
global hubs for the emerging bioplastics industry.
As previously mentioned, the Kingdom of Thailand boasts a flourishing
agricultural sector in products such as rice, cassava, sugarcane and cellulose and
is the world's biggest cassava exporter and second largest exporter of sugar.
Furthermore, as the second biggest food exporter in the Asia Pacific after China,
Thai agriculture possesses the size and capacity to be used as biomass feedstock
for bioplastics. Hence, those investing in the bioplastics industry are afforded
incalculable benefits like ready access to biomass feedstock at competitive
prices and enhanced price stability. Similarly, manufacturing raw biomass
materials into bioplastics is a profitable, value-added business opportunity that
can diversify Thailand's established plastics industry and push forward the
country's goal to move its economy up the value chain and compete in world
markets. In addition, bioplastics can meet the growing demand for
biodegradable products in nations with consumers that are environmentallyconscious. Through the effective promotion of the bioplastics industry, Thailand
can convert itself into an advanced, knowledge-based economy.
Keep these figures in mind.
In May 2013 Thailand's import value of general plastic products amounted to
9,260 million baht, a decrease from April of 0.3 percent. General plastic
products in other categories experienced the highest import value of 3,740
million baht or 40 percent of the overall value, followed by general plastic
products of film type with the import value of 1,344 million baht or 15 percent
of the overall value. For overall imports, the three most important source
markets were Japan, China, and Malaysia.
On the other hand, in May 2013 Thailand's export value of general plastic
products amounted to 9,072 million baht, an increase from April of 19.2
percent. General plastic products under the packaging category had the highest
export value of 2,766 million baht or 30 percent of the overall value, followed
by general plastic products in other categories with the export value of 2,100
million baht or 23 percent of the overall value. For overall exports, the three
most important destination markets were Japan, USA, and Indonesia.
Briefly put, the Thai general plastics industry is advancing and expanding in
terms of both production capacity and capital value. Of equal significance, the
manufacture for export of general plastics is a true growth sector and it is

apparent there are markets for these items. But what about bio-plastics? Can
Thailand transform itself into a "green" economy?
Thailand offers an existing and broad value chain network to the emerging
bioplastics industry. The Kingdom already has a reputation as a strong
competitor in the plastics industry and owns the requisite resources and
infrastructure necessary to be a global leader. According to the International
Trade Center, Thailand was ASEAN's second leading exporter of plastics
products after Singapore and was ranked 20th in the world in 2012. Moreover,
Thailand currently counts more than 3,000 companies in the domestic plastics
industry. With such a large presence in plastics manufacturing evident in the
Kingdom, it is not difficult to find operating facilities in every stage of the
bioplastics value chain process, ranging from biomass processing to biomonomer and biopolymer industries. Likewise, Thailand boasts incredible
potential in its established value chain for plastics, ranging from basic
intermediates to midstream technologies, such as compounding, and
downstream industries, such as molding. For instance, to highlight the
conversion capabilities of Thailand, a plant was established in 2007 to produce
lactic acid, the main raw material for PLA, and it has been in operation ever
since. This illustrates that these established plastics industries can be used
effectively to manufacture biomass into high-value-added bioplastics.
The Thai Government has taken an active role in promoting the bioplastics
industry with the goal to make Thailand the ASEAN hub for bioplastics. Hence,
the Government appointed the National Innovation Agency (NIA) to create a
national roadmap for the development of the bioplastics sector as a "New
Wave" industry. Additionally, the Government also put together many
incentives to support investment in the country's burgeoning bioplastics
industry.
Equally important, the Thai Bio-plastics Industry Association (TBIA) at present
has a memorandum of understanding (MOU) with a number of global
institutions to cooperate in developing harmonized certification and
identification programs and scientifically based tests and specifications for
bioplastics products. The MOU also calls for further collaboration in areas such
as technology development, capacity building, joint ventures, and market
expansion to stimulate greater progress of the bioplastics industry globally.
Similarly, the Government of Thailand has worked closely with other interested
parties, like the NESDB, to create a roadmap to support investment in the
country's emerging bioplastics industry. In fact, the National Innovation Agency
(NIA) will be the key coordinator to convert the roadmap from an idea on paper
into actual practice

To ensure the most efficient execution of the bioplastics roadmap, four key
strategies were identified and the implementation is planned to last over the next
five years (2011-2015). Brief outlines of the four policy approaches are as
follows:
Strategy One : Generating a sufficient supply of biomass feedstock ->> This
plan targets the preparation of adequate quality and quantity of raw materials for
the industry without having to interfere with the food supply.
Strategy Two : Accelerating technology development and technology
cooperation ->> This plan not only focuses on the adoption of overseas
technologies, but also aims at having local researchers and scientists to facilitate
technological advances and innovation beyond those technologies that are being
utilized by the industry. The goal of creating the country's own sustainable
technology base is at the heart of this strategy.
Strategy Three: Fostering industry and innovative businesses ->> This plan
advocates an investment approach in bioplastics industries and businesses from
both upstream and midstream stages right to the downstream phase both at the
international and local business levels.
Strategy Four : Establishing supportive infrastructure ->> This plan includes the
creation of industrial standards, setting up laboratories for testing and certifying
bioplastics products, raising public awareness on the need to use bioplastics
products for environmental reasons, implementation of a pilot project for
bioplastics utilization in small municipalities or communities.
Over the past decade, the Thai Government has taken an active role in pushing
forward the bioplastics industry in order to support Thailand's ambition to
become a regional and worldwide leader. The Ministry of Science and
Technology was assigned to direct the project along with the support of both the
Ministry of Industry and the Office of the Board of Investment of Thailand
(BOI). Additionally, a working committee was appointed by the National
Innovation Agency (NIA) to create a national roadmap for the development of
bio-plastics as a "New Wave" industry.

Generally speaking, Thailand has many advantages and strengths. With the
proper government policy supports, in areas like environmental protection, trade
and investment, and technology invention and application, the country has the
potential to play a leading role in the expansion of the bioplastics industry
throughout the ASEAN region. Plus, there is an abundance of sugar and starchbased feedstock at competitive prices. At present, Thailand is the world's 22nd
largest exporter of bioplastics, with exports totaling some US$2.92 billion in
2010, an increase from US$2.37 billion in 2009. The main exports are film
sheets and packaging material. Likewise, as of 2012, total investments in this
sector amounted to about 22 billion baht, producing products such as lactic acid
dimer to packaging material to PLA resins.
Taking into consideration the vast potential profit earnings of the bioplastics
sector, on the 21st of January 2013 the Thai Government assigned the Ministry
of Energy to be the principal agency in establishing a mechanism for the
development of measures to promote Thailand as a hub of the bioplastics
industry in ASEAN. In cooperation with the Ministry of Agriculture and
Cooperatives, the Ministry of Industry, the Ministry of Science and Technology,
the Ministry of Commerce, and the private sector, the Ministry of Energy seeks
to draft comprehensive policies, to increase accessibility to essential raw
materials, and to select the appropriate pilot city.
Certainly, Thailand's bioplastics roadmap and full range of incentives to
encourage investment have attracted many specialized firms such as
Corbion/Purac (lactic acid and lactide), PTTGC/NatureWorks (polylactic acid),
Bioamber/Mitsui (succinic acid) and PTTMCC Biochem (polybutylene
succinate adipate). With Southeast Asia projected to become the world's major
bioplastics manufacturing region in the next 10 years, the country is readying
itself for the commercial opportunities of the future by continuing to implement
its blueprint, develop new innovative technology and build its infrastructure and
logistics networks.
The general plastics industry is forecast to progress in line with the economic
growth of the country. In 2013 the Thai economy is expected to expand
approximately 4.2-5.2 percent. Moreover, the Government's inbound and
outbound investment promotions will result in more consumption demand and
the increased export of general plastic products. Yet room exists for the
development of the bioplastics sector.
As part of its policy to promote sustainable development, enhance the country's
competitiveness in science and technology, encourage the improvement of
manufacturing quality as well as reduce environmental pollution and waste, the
Office of the Board of Investment of Thailand offers special tax incentives in
specific activities that support national development objectives. Furthermore, in
recognizing the value of the bioplastics industry to the future of Thailand, the
BOI has classified two enterprises related to bioplastics - manufacture of ecofriendly chemicals and manufacture of eco-friendly products - as priority

activities of special importance and benefit to the country. In fact, the
aforementioned enterprises involve standard BOI incentives such as an
exemption of import duties on machinery and an 8-year exemption of corporate
income tax with no cap. Likewise, these projects can be located anywhere in the
country, except for Bangkok, and investment promotion applications can be
submitted by the 31st of December 2013. Companies that have been designated
as BOI-approved are then eligible to receive added tax incentives under the
BOI's Investment Promotion Policy for Sustainable Development, which
includes:
• Exemption of import duties on machinery
• 8-year exemption of corporate income tax with no cap
• 5-year 50% reduction of corporate income tax on net profit
• 10-year double deduction of transportation, electricity and water supply costs
• Deduction from net profit of 25% of investment in infrastructure installation
and construction costs, in addition to normal capital depreciation